By Baron Ike
Diamond bank management has confirmed that it is in talks with potential investors on how to shore up the capital base of the commercial bank in the face of current challenges that caused top management board members’ resignation.
The bank however said that recent reports regarding why its chairman of board and three non-executive directors resigned were speculative.
Oluseyi Bickersteth, the chairman of board and three non-executive directors, Rotimi Oyekanmi, Mrs. Juliet Anammah and Mrs. Aisha Oyebode resigned their appointments unexpectedly late October.
Bickersteth was appointed in June to replace Chris Ogbechie, and he was said to be having issues with the original owners of the bank based on business interest.
But Diamond bank said in a statement from Ezechinyere Anyanwu, Media Relations Officer Corporate Communications that the reports by the media (hard copy and online) were more speculative than real.
However, the bank’s statement confirmed that recapitalization and funds injection were at the heart of some of the issues that caused the exit of Bickersteth and others.
The statement read: “The Board of Diamond Bank Plc (Diamond Bank or the Company) notes the media speculation relating to comments attributed to its former Chairman, Mr. Oluseyi Bickersteth.
“Contrary to such media articles, the Board wishes to clarify that the Company has not received an offer from an investor to inject cash.
“Further to the Company’s announcement of 26 October 2018, Diamond Bank and its Board of Directors continue to review all strategic options on a regular basis.
“Diamond Bank would also like to clarify it enjoys the support of its major shareholders, including The Carlyle Group and Kunoch Holdings who are, as ever, working in cooperation with the Board and management as appropriate to ensure the successful operation of its business in Africa’s most dynamic banking market.
“Further to the announcement of 24 October 2018, Diamond Bank is in active discussions with regards to the appointment of new non-executive directors to the Board and, subject to CBN approval, these will be announced in due course.
“Diamond Bank’s recent Third Quarter results published on October 26, 2018 show the business continues to execute its clearly articulated tech-led retail strategy despite headwinds in the Nigerian economy.”
Diamond Bank had informed the Nigerian Stock Exchange through a letter dated October 24 about their resignation, saying they were going to pursue personal priorities.
As soon as the resignation of the chairman and the directors became public knowledge, the management of Diamond Bank began to get calls from across the country and beyond on what could have happened because of the implication of the resignation, Armadanews.com was informed.
Many customers of Diamond bank also started calling their account officers to be sure there was no problem big enough to affect their investment.
Signs that Diamond bank was facing difficulties started showing up earlier in the year when in April, the managing director, Uzoma Dozie, announced that the bank was closing its United Kingdom operations state to concentrate on Nigeria, apparently to further cut cost.
Many felt the bank was economical with the truth as Bickersteth and others’ resignation was said to be connected to certain business interest involving the ownership and investment interest of other stakeholders.
For instance, it was gathered that the resignation followed a protracted dispute involving a major investor, Carlyle Group (NASDAQ CG), over the composition of the board of the bank.
The group had in August 2014 invested $147 million in Diamond Bank when the bank made a $305 million rights issue.
Announcing the investment November that year, the bank said the rights issue was to improve its Tier 1 capital, strengthen its balance sheet and support its continued growth plans.
It said the proceeds would be used for the development of its “IT infrastructure, working capital support and the expansion and refurbishment of its branches.”
Also commenting at the time, Genevieve Sangudi, Managing Director and Head of West Africa for the Carlyle Sub-Saharan Africa Fund, said the group was “very pleased to join the Diamond Bank Group as an investor.
“We are fully in support of the bank’s strategic goal to become one of the most successful Tier 1 banks in Nigeria and West Africa, and we look forward to supporting the Bank towards achieving this objective.”
Welcoming the investor, Uzoma Dozie, the Group Managing Director/Chief Executive Officer (Designate) of Diamond Bank, said: “We are confident that Carlyle’s support will be fruitful and benefit all stakeholders. They bring global expertise in financial services and banking, having invested $4 billion globally in over 25 financial services companies, along with long-standing experience in emerging markets.
“Diamond Bank also stands to benefit from Carlyle’s extensive network of financial services specialists as we continue to strengthen our market position, expand our commercial and retail offerings and further enhance our operations. We are delighted to have Carlyle as a significant shareholder of the Bank.”
An insider said the dispute that led to Wednesday’s resignations centred on the insistence of the founder of the bank, Paschal Dozie, to have his son on the board.
It was, however, not clear whether this referred to Uzoma Dozie who had been the GMD/CEO of the bank since 2014.
The Carlyle Group, on its website describes itself as “a global alternative asset manager with $203 billion of assets under management across 129 funds and 141 fund of funds vehicles as of September 30, 2014.
“The group has expertise in various industries, including financial services and employs 1,700 people in 40 offices across six continents.
“Launched in 2011,The Carlyle Sub-Saharan Africa Fund and its affiliates by 2014 had invested almost $300 million across a variety of industries, including logistics, mining services, retail and financial services in countries, including Nigeria, Mozambique, Zambia, Tanzania, the Democratic Republic of the Congo and Southern Africa.”
Managing Director of Diamond Bank, Uzoma Dozie
.Additional report from Premium Times